Current Thinking On Reciprocal Vs. One-way Links?

My site, [removed] used to have a PR of 6 and was recently downgraded to 2. I've tried a few things to solve that, like making the alt tags descriptive of the page they are going to (they were stuffed with keywords before). One thing I'm trying to figure out now is the links strategy. I know there are a lot of postings on this already, but a lot of them are years old and I'm wondering how current the ideas expressed there are. I already have a lot of links with reciprocating sites. Some are high quality, some less, but I don't have the time to analyze each and every one in depth. I am thinking of a few possible approaches:

1. Get rid of all reciprocal links completely and focus on building one-way links between [my site] and other quality sites. I would trade a link to one of our other related sites for a link to [my site]. 2. Going through the current link pages and weeding out the dead links and the lower-quality ones, also reducing the number of links per link page.3. Abandoning the current domain name and starting a new one more reflective of the keywords. [another site] has always been ahead of me in the Google rankings despite the fact that it has always been a site with much less useful content. The only explanation I can see is the domain name, which exactly reflects the main keyword (engineering jobs).

I know there are other things that could be done on the site, e.g. redesign etc. Redesigning the site would be a huge project that is probably beyond me right now.

Is there a particular reason why you care what the toolbar displays? Have you seen a marked decline in search engine referrals?

One of the issues with being super-busy on reciprocal linking is that it may trigger the same systems that locate paid link networks. Paid links are one possible cause for a drop in toolbar PageRank. Are the 'college degree' links on [page removed] paid links?

Thanks for your answer. We have seen a big drop in search engine referrals, but that may also be because we have cut way back on our advertising budget (business is pretty slow). We used to show on the first page on Google for the main keyword people search for (engineering Jobs) but now we are not even in the first 10 pages.

The college degree links are paid links. Would it be a good idea to drop those?